Standing out within your industry is the hallmark of a solid success model but the road to having the reputation as “simply the best” takes hard work, dedication and an honest assessment of strengths and weaknesses. That’s where the use of industry benchmarks can come into play.
Around since back in the day of the NOMDA – the predecessor of BTA – industry benchmarks have developed into a must-have tool for office technology dealers regardless of size. In a nutshell, benchmarking boils down the best practices that can help you lead your company to superior performance.
Widely used as a mechanism to evaluate companies for acquisition value, benchmark workshops such as the BTA’s ProFinance courses help dealers understand what makes money and, conversely, what drains profits from their business. In down-to-earth language, these workshops set concrete standards to measure against and enable you to focus on specific areas for improvement.
I took my first benchmarking workshop back in 1992 and have continued with them throughout the years, always learning something new. I understand that the most recent version, ProFinance 2.0, includes more than 30 key benchmarks. For what I consider to be a fair cost, these hands-on educational roadmaps to success cover topics from financial management to company culture—all information that can then be shared with your staff.
Granted, I’m a proponent of BTA’s workshops, but the tools really come to life when sharing with your management team. Having an objective industry measurement helps give your company feedback on how they are performing and, more importantly, what’s possible.
Financial benchmarking analyzes and compares your company’s overall performance while comparing you to the performance of our industry’s best-managed companies. It provides focus on what you are doing well and where improvements can be achieved.
Productivity is another vital element of benchmarking and can be measured through several specific avenues, such as the amount of revenue generated per employee; ratios between the amount of equipment sold and the number of salespeople on staff; and the effectiveness of service technicians compared to revenue brought in. Another way to assess productivity is by measuring your profitability. This appraisal compares a company’s gross profits in specific areas, equipment, supplies, service and rentals.
Managing and controlling expenses is more effective when using a set of benchmarks. Every dealership has its unique characteristics, but having something you can consistently measure against lets you know where you are on the spectrum.
Again, benchmarking comes down to an accurate assessment of the areas where your business is strong and where it is lacking…and just as, if not more importantly, an understanding of your competitors’ strengths and potential weaknesses.
Ways to identify limitations within your business might include conversations with employees, customers and suppliers. You can also research companies that are recognized as industry leaders and try to identify how they achieved their status. Take the next step and visit a couple of these “best practice” companies; many industry leaders encourage open communication with others in their industry since a mutual exchange of information can be beneficial to all involved.
And don’t forget about joining a peer group that meets regularly to address best practices. All the major industry trade groups, including SDG (of which we are a member), have their membership use industry benchmarks.
The positive impact of benchmarking has been documented, yet a relatively small percentage of us in the office product industry adopt the practice, and that’s a shame because benchmarking can improve company performance and ultimately help us to better serve our customers.